“CCS will never fly!” - How the oil & gas industry can contribute to EU CCS

Jun 12 2018


National governments, EU institutions and industry all need to work together to prepare for the deployment of CCS solutions. The oil & gas industry can help. By François-Régis Mouton, IOGP’s Director EU Affairs

Over the last few years, every time I would mention CCS to EU policymakers, their most common reaction was to snicker and say something along the lines of «come on, we know CCS is never going to fly». Today, as the Paris Agreement commitments start to materialize, I wouldn’t go as far as to say that they’re all believers, but I think it’s fair to say policymakers are curious to hear more.

 

The Paris Agreement and the realization that all sectors of the economy will have to be involved in the decarbonization process has definitely helped in that regard. The IPCC sees CCS as a key technology to deliver the negative emissions required in 101 out of 116 possible scenarios limiting global warming to well below 2 degrees C1. Likewise, the IEA gives an important role to CCS (the third lever after energy efficiency and renewables2) in the GHG mitigation effort of its long-term projections.

 

But what could be the perfect argument for advocates of CCS is used by anti-oil & gas environmentalist movements who point out, rightly so I must admit, to the current gap between deployment expectations and reality. Still, is it reason enough to “shoot the ambulance” as we say in France? And more importantly, how do we pick up the pace?

 

Naturally, the oil & gas sector has extensive experience in CCS technology itself but also in exploration skills, geology, reservoir engineering, chemistry and large-scale project management which are all essential to the development of CCS projects. And yet CCS is much more than just ‘an oil & gas thing’ – it is a technology that will become crucial for much of the industrial sector, which makes up for around 20% of EU GHG emissions.

 

European policymakers are currently looking at a new energy Roadmap to 2050, one which would put the EU in line with the more ambitious side of the 80-95% GHG emission reduction spectrum currently in place.

 

This effort will require an extra push into all sectors of the economy, including those that are difficult to decarbonise (the ones to which variable renewable electricity and energy efficiency cant provide convincing solutions). Indeed, many industries create CO2 as a byproduct of their industrial processes, not because they necessarily use carbon intensive energy sources. For them, capturing and disposing of that CO2 may well be the only option to exist in a Europe that aims to be competitive while bringing its emissions down to zero.

 

Part of this will be done through energy efficiency and fuel-switching (including coal-to gas), but in many cases, CCS will be a prerequisite. If we want to prepare for the deployment of CCS solutions in the long term, we need to get the fundamentals in place now.

 

How can the oil & gas industry contribute?

 

Our sector has extensive experience with CO2 management, from capture and transport to safe storage. This expertise can be beneficial for other industrial sectors as well – CCUS opens opportunities for new business models where our industry has real strengths to play on and experience to leverage. We can group these solution in two categories where our industry will play a part: post-combustion and pre-combustion.

 

Post-combustion solutions are those that typically come to policymakers’ mind when dicussing CC(U)S. Recently, projects such as that of the Port of Rotterdam in the Netherlands, or Northern Lights in Norway, gained traction within interested policymaking circles.

 

In these projects, industrial installations find themselves in need of CO2 disposal (refineries, cement factories, chemical plants, etc.) or supply solutions (horticultural firms). Once captured, part of the CO2 would be transported by pipeline (Port of Rotterdam) or by ship (Northern Lights) and stored into depleted fields in the North Sea, and the rest supplied to industrial users on the ground, contributing to the creation of a circular economy cycle.

 

But such economies of scale can also be achieved at the pre-combustion level, by stripping natural gas from its carbon and turning it to ‘blue hydrogen’, to be used as feedstock or energy source by industrial users and households. There too Europe leads the way, with promising projects such as the Leeds and Manchester-Liverpool Hydrogen projects in the UK, and the Magnum project in the Netherlands.

 

In Leeds, it’s essentially about determining the feasability of converting the existing gas infrastructure into one for hydrogen, with a potential extension to the entire UK should results be conclusive. In Manchester and Liverpool, hydrogen made in large part by conversion of natural gas through Steam Methane Reforming and storage of the CO2 in the Irish Sea, would be supplied to car manufacturers and refineries, as well as households. At a smaller scale, the conversion of one of the three Magnum gas power plant units of Eemshaven into one running on hydrogen, combined to CCS, is another exciting project our industry is working on.

 

Natural gas-to-hydrogen conversion with CCS catches EU policymakers’ attention every time I mention it. CCS as a technology that works; we know it, they know it. The problem lies in economics most of the time, infrastructure, and sometimes public acceptance in countries such as Germany.

 

EU Member States need to realize that the challenges they face now will require solutions parallel to those that have been prioritised this far. By supporting the development of renewable electricity sources – through funding for research, support mechanisms, and even specific targets – renewables have become an important source of cleaner energy in Europe, and their share will continue to grow. But variable renewable energy alone won’t cut it if we are to achieve deeper decarbonisation.

 

Previous funding programmes at the EU level have failed to help realise the potential of CCS. The next ones have to make sure that projects of scale can benefit too if not from one fund alone, then in combination with several. National governments, EU institutions and industry need to work together on this. The realisation of such impactful projects will see significant emission reductions today, while providing building blocks for tomorrows challenges.

 

CCS has to be put on equal footing with other CO2 abatement solutions. Governments, when developing their strategies towards 2050, need to bear in mind the final goal at the end of the century. Preparing for CCS now has to be part of it.

1 IPCC (2014): Climate Change 2014: Synthesis Report. Contribution of Working Groups I, II and II to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change [Core Writing Team, R.K. Pachauri and L.A. Meyer (eds.)]. IPCC, Geneva, Switzerland.

2 IEA: World Energy Outlook 2017. CCS accounts for 9% of GHG savings needed to move from the IEA’s New Policies Scenario to the Sustainable Development Scenario

 

International Association of Oil & Gas Producers


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Issue 62 - Mar - Apr 2018

CCS in the U.S.: Expanded tax credit could boost projects and start a CCS gold rush .. Moody’s: Coal will continue secular decline without CCS .. Capturing and using CO2 from ethanol STEMM-CCS: improving the safety of offshore CO2 storage .. Energy .....


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